Finnish Gaming Giant Records Falling 2018 Profits

When
it comes to the mobile gaming industry, upheavals and changes are
quicker than many other industries. A company can produce a string of
hit games, but when new games are not coming up, then it can find
itself in trouble. That is exactly what seems to have happened with
Finnish mobile game developer Supercell as its hit games are now
growing old and consequently, the company has recorded a sharp fall
in profits for the year 2018.

The
mobile game developer recorded a drop in profits to the tune of a
whopping 26% in 2018 and according to reports; some of the company’s
biggest revenue earning games have fared badly. Clash Royale and
Clash of Clans, which have historically generated revenues, have not
performed well and much of it has to do with the fact that both games
are relatively old.

The
Finnish company was founded in 2010 and 2012; it launched Clash of
Clans, which quickly went on to become one of the world’s most
popular mobile games. As of 2018, it was the world’s fourth biggest
game. Tencent Holdings Limited of China holds the controlling stake
in the Finnish company, and according to the latest figures, earnings
plunged to 529 million Euros as opposed to 729 million Euros in 2018.

In
addition to that, revenue fell from 1.8 billion Euros to 1.37 billion
Euros, which reflects a drop of 24%. It is a sobering time for the
company, which was valued at $10 billion as recently as 2016 and grew
exponentially on the merits of its existing games. However, it is now
abundantly clear that Supercell now needs to create new games that
will find as big a customer base as its early successes. The company
has only produced five games so far, and the latest one was Brawl
Stars, that was launched in December of 2018. Although the game did
manage to become the top game in Korea and Japan, it did not meet the
targets that the company had set. That being said, these are still
early days, and the game could find traction in the near term.

Ikka
Paanenen, the chief executive of Supercell, did not go into a
breakdown of sales figures for its four games but he did point out
that Clash Royale and Clash of Clans recorded the biggest drops in
revenues. It remains to be seen what the company does to stage a
turnaround this year.

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